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What is Unfair Dismissal Compensation?

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  • Written By: Autumn Rivers
  • Edited By: Andrew Jones
  • Last Modified Date: 08 November 2016
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Unfair dismissal compensation is paid to employees who have been wrongfully terminated from their jobs. It is usually requested after an employer has fired someone for a reason that is against the law, or has gone against the proper procedure for termination within a company. The compensation received in a successful wrongful termination case can differ, with most former employees seeking to receive their usual paycheck for at least a few months while they search for a new job. Some terminated employees also request that their benefits package be extended for several months, including perks like health insurance, stock options, and use of a company vehicle. Of course, cases that involve plenty of evidence of wrongdoing by the employer may result in a hefty sum of money for the former employee.

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It is often difficult to get unfair dismissal compensation unless it can be proven that the employer was clearly in the wrong when firing an employee. For example, discrimination based on age, sex, religion, race, or nationality is typically considered against the law, which means that employees who can prove this offense are likely to get unfair dismissal compensation. Employers are also not typically allowed to fire anyone out of retaliation or due to the employee's refusal to perform an illegal act. It is often necessary as well for the employer to follow the procedures in their company's handbook, which usually includes giving out written warnings before terminating anyone. Employees who can prove that their former employer committed any of these offenses may have a wrongful dismissal case.

In most cases, unfair dismissal compensation is meant to provide fired employees with some income while they seek a new job. For example, it is considered typical for an employee to receive a month of salary for every year that they were with the company before the wrongful dismissal. Any expenses that they encounter during their search for a new job may also be paid by the former employer. Of course, some high profile cases, or those with a lot of evidence against an employer, may result in a much higher payout for the fired employee.

Many people want more than money when it comes to their unfair dismissal compensation, as they need the same benefits that they were getting while employed. For instance, many employers offer health insurance at a reasonable rate for employees, and those who have been terminated often want continued coverage while they seek a new job. Some lawyers can even negotiate continued access to stock options, pension benefits, and company bonuses for fired employees through their unfair dismissal compensation package. Finally, employers who offer their workers a company vehicle may be required to do the same for former employees who were fired unfairly.

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